GM to lay off up to 14K workers, close as many as 5 plants

General Motors will cut up to 14,000 workers in North America and put five plants up for possible closure as it abandons many of its car models and restructures to focus more on autonomous and electric vehicles, the automaker announced Monday.

Posted: Nov 26, 2018 4:07 PM

DETROIT (AP) — General Motors will cut up to 14,000 workers in North America and put five plants up for possible closure as it abandons many of its car models and restructures to focus more on autonomous and electric vehicles, the automaker announced Monday.

The reductions could amount to as much as 8 percent of GM’s global workforce of 180,000 employees.

The restructuring reflects changing North American auto markets as manufacturers continue to shift away from cars toward SUVs and trucks. In October, almost 65 percent of new vehicles sold in the U.S. were trucks or SUVs. That figure was about 50 percent cars just five years ago.

GM is shedding cars largely because it doesn’t make money on them, Citi analyst Itay Michaeli wrote in a note to investors.

“We estimate sedans operate at a significant loss, hence the need for classic restructuring,” he wrote.

The reduction includes about 8,000 white-collar employees, or 15 percent of GM’s North American white-collar workforce. Some will take buyouts while others will be laid off.

At the factories, around 3,300 blue-collar workers could lose jobs in Canada and another 2,600 in the U.S., but some U.S. workers could transfer to truck or SUV factories that are increasing production.

The company also said it will stop operating two additional factories outside North America by the end of next year, in addition to a previously announced plant closure in Gunsan, South Korea.

General Motors Co.’s pre-emptive strike to get leaner before the next downturn likely will be followed by Ford Motor Co., which has said it is restructuring and will lay off an unspecified number of white-collar workers. Toyota Motor Corp. also has discussed cutting costs, even though it’s building a new assembly plant in Alabama.

GM isn’t the first to abandon much of its car market. Fiat Chrysler Automobiles got out of small and midsize cars two years ago, while Ford announced plans to shed all cars but the Mustang sports car in the U.S. in the coming years.

Shares of GM, the largest automaker in the U.S. which sells the Chevrolet, Buick, Cadillac and GMC brands, rose nearly 6 percent on the news to $37.98 in Monday afternoon trading.

GM doesn’t foresee an economic downturn and is making the cuts “to get in front of it while the company is strong and while the economy is strong,” CEO Mary Barra told reporters.

She also noted that tariffs on imported aluminum and steel have hit the company, but she stopped short of saying they had anything to do with the restructuring.

After the morning announcement, Barra was to head for Washington to meet with White House economic adviser Larry Kudlow in what was described as a previously scheduled meeting, according to a White House official who spoke on condition of anonymity because the official is not authorized to discuss the meeting publicly.

President Donald Trump said his administration and lawmakers are exerting “a lot of pressure” on GM.

Trump said he was being tough on Barra. He said he told the company that the U.S. has done a lot for GM and that if its cars aren’t selling, the company needs to produce ones that will.

At a rally near Lordstown, Ohio, plant last summer, Trump told people not to sell their homes because the jobs are “coming back. They’re all coming back.”

Most of the factories to be affected by GM’s restructuring build cars that will not be sold in the U.S. after next year. They could close or they could get different vehicles to build. Their futures will be part of contract talks with the United Auto Workers union next year.

The Detroit-based union has already condemned GM’s actions and threatened to fight them “through every legal, contractual and collective bargaining avenue open to our membership.”

Factories that don’t have any products after next year and could be closed include assembly plants in Detroit and Oshawa, Ontario, and Lordstown, Ohio, as well as transmission plants in Warren, Michigan, and near Baltimore.

Bobbi Marsh, who has worked assembling the Chevrolet Cruze compact car at the Ohio plant since 2008, said she can’t understand why the factory might close given the strong economy.

“I can’t believe our president would allow this to happen,” she said Monday.

She now faces an uncertain future, not knowing whether the plant will close for good or if there’s a chance it could find another use.

“Everything is up in the air,” she said. “I don’t want to give up hope for this facility and these people. I spend more time around them than my own family. It would be like breaking up a family.”

Democratic Sen. Sherrod Brown said the move will be disastrous for the region around Youngstown, Ohio, east of Cleveland, where GM is one of the area’s few remaining industrial anchors.

“GM received record tax breaks as a result of the GOP’s tax bill last year, and has eliminated jobs instead of using that tax windfall to invest in American workers,” he said in a statement.

Many of those who will lose jobs are now working on conventional cars with internal combustion engines. Barra said the industry is changing rapidly and moving toward electric propulsion, autonomous vehicles and ride-sharing, and GM must adjust.

She said GM is still hiring people with expertise in software and electric and autonomous vehicles.

Among the facilities on the chopping block are the Detroit/Hamtramck assembly plant, which makes the Buick LaCrosse, the Chevrolet Impala and Volt, and the Cadillac CT6, all slow-selling cars. LaCrosse and Chevrolet Volt plug-in hybrid production will end March 1, while CT6 and Impala production would stop June 1.

Barra said the Cruze would no longer be sold in the U.S. Production would stop March 1.

Work on six-speed transmissions made at the Warren, Michigan, transmission plant would stop Aug. 1, while the Baltimore transmission plant would stop production April 1, GM said.

GM said it was ending Volt production because the vehicle was meant to be a bridge to fully electric cars when it was introduced about a decade ago. The Volt has a small battery that can take it about 50 miles, then it switches to a small gasoline engine.

Since it was introduced, battery technology has improved dramatically. Now the full-electric Chevrolet Bolt can go up to 238 miles on a single charge.

Meanwhile, GM’s plant in Oshawa, Ontario, will stop making the Impala, Cadillac XTS and 2018 full-size pickups in the fourth quarter of next year. The Canadian plant appeared to be most in danger of closing.

Matt Smith has worked at the Oshawa plant for 12 years, and his wife also works at the facility. They have an 11-month-old at home.

“I don’t know how I’m going to feed my family,” he said outside of the plant’s south gate, where workers instituted a blockade for trucks from the entrance. “It’s hard, it’s horrible.”

GM builds full-size Chevrolet and GMC pickups in Mexico, and it recently announced that a new Chevrolet Blazer SUV will be built there. Also, GM imports the Buick Envision midsize SUV from China.

___

Associated Press writers Rob Gillies in Toronto, John Seewer in Toledo, Ohio, and Zeke Miller in Washington contributed to this report.

Indiana Coronavirus Cases

(Widget updates once daily at 8 p.m. ET)

Confirmed Cases: 33068

Reported Deaths: 2068
CountyConfirmedDeaths
Marion9524558
Lake3494175
Cass15897
Allen141966
St. Joseph122134
Hendricks114268
Hamilton113292
Elkhart110128
Johnson1092106
Madison58459
Porter50522
Bartholomew49034
Clark47941
LaPorte42022
Tippecanoe3823
Howard37824
Delaware37636
Jackson3721
Shelby36822
Hancock32727
Floyd31739
Boone30535
Morgan27724
Vanderburgh2592
Montgomery23417
White2308
Decatur22431
Clinton2221
Noble20421
Grant19721
Dubois1903
Harrison18921
Henry16910
Greene16824
Monroe16512
Warrick16528
Dearborn16521
Vigo1538
Lawrence15223
Miami1401
Putnam1357
Jennings1294
Orange12422
Scott1203
Ripley1106
Franklin1098
Kosciusko1011
Carroll933
Daviess8416
Steuben812
Marshall801
Newton7610
Wayne756
Fayette747
Wabash742
LaGrange682
Jasper661
Washington511
Jay490
Fulton471
Clay461
Rush452
Randolph453
Jefferson431
Pulaski410
Whitley383
Owen351
Sullivan341
DeKalb331
Brown331
Starke323
Perry280
Wells270
Benton260
Huntington262
Knox250
Tipton241
Crawford230
Blackford222
Parke190
Spencer191
Switzerland190
Fountain182
Posey160
Gibson142
Adams131
Ohio130
Warren121
Vermillion100
Martin90
Union80
Pike60
Unassigned0161

Illinois Coronavirus Cases

(Widget updates once daily at 7 p.m. CT)

Confirmed Cases: 115833

Reported Deaths: 5186
CountyConfirmedDeaths
Cook753063519
Lake7933281
DuPage7460350
Kane6083167
Will5356268
Winnebago209153
McHenry148870
St. Clair105077
Kankakee83644
Kendall75119
Rock Island63923
Champaign5957
Madison54557
Boone42416
DeKalb3704
Sangamon34328
Randolph2674
Jackson25610
McLean21613
Ogle2002
Stephenson1992
Macon19219
Peoria1918
Out of IL1831
Clinton18017
Union1519
Unassigned1490
LaSalle14113
Whiteside13412
Iroquois1314
Coles12313
Warren1130
Jefferson10116
Knox960
Grundy952
Monroe9311
McDonough847
Lee791
Tazewell704
Cass690
Henry670
Williamson602
Marion500
Jasper457
Adams441
Macoupin442
Perry410
Pulaski410
Montgomery391
Vermilion381
Morgan341
Christian334
Jo Daviess320
Livingston322
Douglas260
Fayette203
Ford201
Jersey201
Menard190
Mason180
Washington180
Woodford182
Hancock160
Mercer160
Shelby161
Bureau151
Carroll142
Bond121
Franklin120
Piatt120
Schuyler120
Clark110
Crawford110
Fulton110
Brown100
Cumberland100
Logan100
Moultrie100
Wayne91
Alexander80
Henderson80
Johnson70
Massac70
Saline70
Effingham61
Greene50
Marshall50
De Witt40
Lawrence40
Richland30
Stark30
Clay20
Edwards20
Gallatin20
Hamilton20
Wabash20
White20
Calhoun10
Hardin10
Pike10
Pope10
Putnam10
Edgar00
Terre Haute
Overcast
69° wxIcon
Hi: 77° Lo: 55°
Feels Like: 69°
Robinson
Overcast
67° wxIcon
Hi: 76° Lo: 54°
Feels Like: 67°
Indianapolis
Overcast
67° wxIcon
Hi: 74° Lo: 55°
Feels Like: 67°
Rockville
Overcast
64° wxIcon
Hi: 75° Lo: 54°
Feels Like: 64°
Casey
Overcast
66° wxIcon
Hi: 77° Lo: 54°
Feels Like: 66°
Brazil
Overcast
69° wxIcon
Hi: 75° Lo: 54°
Feels Like: 69°
Marshall
Overcast
69° wxIcon
Hi: 77° Lo: 54°
Feels Like: 69°
Showers Early, Cooler
WTHI Planner
WTHI Temps
WTHI Radar

WTHI Events